Leading crypto exchange Coinbase announced implementing a plan in order to comply with the current global sanctions. The platform through its blog rolled out steps to initiate the compliance program which it mentioned would help protect ‘the integrity of all transactions supported by its platform’.
The post, written by Paul Grewal who is the Chief Legal Officer of Coinbase then talked about the measures it has adopted while adhering to economic penalties.
First, it worked on screening out sanctioned individuals or entities prior to providing accessibility. They use geofencing controls to block access to the Coinbase website, products, and services, by anyone using an IP address in a sanctioned geography.
Next, they monitor against evasion attempts. According to the blog, Coinbase regularly updates the global sanctions lists and works to map transactions beyond the entities and individuals specifically flagged by governments.
To safeguard against malicious attacks, Coinbase maintains a sophisticated blockchain analytics program to identify high-risk behavior, study emerging threats, and develop new mitigations. The platform cited an example in a 2020 case where it identified over 1,200 additional addresses potentially associated with the sanctioned individual.
Besides that, the platform till now has prevented access to over 25,000 addresses related to Russian individuals or entities believed to be engaging in illicit activity. “Once we identified these addresses, we shared them with the government to further support sanctions enforcement,” the blog added.
Coinbase- Crypto can deter evasion attempts
On the role of digital assets’ ability to deter fraud, the report argues that crypto transactions are ‘traceable, permanent, and public.’ which is makes it competent enough to detect and deter evasion compared to the traditional financial system.
Amidst fears that Russia might use crypto to circumvent sanctions, several digital asset platforms have announced plans to prevent that.
One of them is Gemini which in a recent interview revealed that it is taking measures to stop those trying to evade sanctions on Russia. Another cryptocurrency firm, eToro announced that its investment platform is not open to users in Russia. A spokesperson further added that eToro is “rigorous in its compliance with all relevant rules and regulations, including sanctions.”